Overview
Client Credit Enhancement Guarantee Facility (CCEF) is a USD 100 million credit enhancement facility designed by Ignite Power to accelerate electrification for 600 million people living in rural, “last mile” communities across Sub-Saharan Africa.
Problem
The capital for scaling rural off-grid electrification continues to sit on the sidelines in Sub-Saharan Africa, where approximately 600 million people lack access to electricity. The challenge in solving this problem includes difficulty securing investment due to concerns about end-client payment risk, which makes it difficult to attract capital to finance these electrification projects.
Solution
Ignite Power designed CCEF as a rolling guarantee mechanism to address irregular payment patterns, including defaults, to mitigate end-client risk in pay-as-you-go (PAYGO) solar projects. This will reduce reliance on concessionary capital and help meet investors’ dual objectives of risk-adjusted market returns with significant impact. With this, the CCEF will accelerate electrification for 600 million people living in rural sub-Saharan Africa. The CCEF structure is envisioned to comprise both unfunded and funded guarantee components. The unfunded portion is expected to cover overall portfolio risk. In contrast, the funded portion will temporarily cover customer payment shortfalls, typically caused by seasonal events, until end-user regular payments can resume (e.g., harvest season).
CC Facility Support
The CC Facility is supporting Ignite Power with grant and acceleration support for structuring activities, fundraising, and developing a Gender and Social Inclusion (GESI) strategy for the CCEF.
Website
Ignite Power (Solar) - https://ignite.solar/